The burden of unmanageable levels of debt is something that nobody ever wants to face, but far too many people do. Debt consolidation can be a useful solution, provided that it is done in a smart, deliberate manner. The piece below offers lots of helpful tips for ensuring that you make the best decisions for you and your family.

Understand the difference between debt consolidation and a home equity loan. Many companies will guise a home equity loan (where you put your home on the line for the debt) as right debt consolidation. That's not always the wisest move to make, especially if you have a family involved. Know the differences and the risks before making that decision.

Consolidate all of your high-interest credit cards onto one credit card with a reasonable interest level. If you've got multiple cards above 20% interest, you are paying way too much. That money going to interest could be helping you pay off that debt! Plus multiple cards means multiple minimum payments. It's best to attack one card alone if you can.

Before going with any specific debt consolidation company, check their records with the Better Business Bureau. There are a lot of sketchy "opportunities" in the debt consolidation business. It's easy to go down the wrong path if you aren't careful. The BBB and its reports can help you weed out the bad from the good.

If you are struggling with debt, let your family and friends know. Your immediate family or close friends may be willing to loan you enough money to consolidate your bills. If your family is ready to lend you the money, draw up an installment agreement that defines the payment amount you will pay them along with the length of the loan and any interest charged.

Find out which debts you have that will not be covered in debt consolidation. While most debts can be consolidated, there are a few that cannot, such as some student loans. You need to make sure that you know what will be covered and what will not before you sign up.

Ask for a copy of your credit report before looking into debt consolidation strategies. Go over your report to find potential errors and use it to make a list of all your creditors. If you notice any mistakes on your credit report, have them fixed before working on paying your debt off.

You can save a lot of money if you receive a 0 % introductory APR credit card offer that allows balance transfers. While you must be diligent and disciplined, transferring a balance from a credit card with a high-interest rate allows you the chance to pay that balance off much more comfortable. However, you must be able to handle this form of debt consolidation, or it will not help you at all.

Think about entering into negotiations with creditors on your own before investigating consolidation. Check to see if your credit card provider will lower your rate of interest if you stop using the card. They may offer you a rate plan that is fixed. Asking them can't hurt because they would rather have something than nothing.

Don't assume a credit transfer offer will save you money when consolidating debt. Look at the fine print. Often there's an initial fee that you need to pay (it can be multiple hundreds of dollars), and there's usually a 12-month or 18-month limit to the offer. At that point, the interest rate may increase to higher than it was before. Do the math before you say yes to make sure that the deal works in your favor.

Choose a debt consolidation company that is accessible by phone and email. You should not hesitate to ask questions or ask for help if you cannot make a payment on time. Always stay informed and ensure that your company is delivering excellent customer service.

Remember that filing for bankruptcy usually still allows you to keep your home. If you take on a line of credit which is secured by your home, you will lose it if you are unable to pay off your debt. Keep this in mind as you choose your path to financial freedom.

When you've got a list of all the people whom money is owed to, get the details for every debt. You should know the amount of money you owe, the due dates, your interest amounts, and your monthly payments. You need to have all your information gathered together so that you have a clear picture of everything during the debt consolidation process.

Think carefully before signing up with a debt consolidation company. You may be in a state of panic or worry about your financial situation, and you may be acting in a rushed or desperate manner. Think carefully about what matters for you in the long run, and make choices accordingly.

Think carefully about the contract offered by your debt consolidation agency. Go over the terms and conditions and assess the impact of this payment arrangement on your finances. Make sure this contract is a better option than paying your creditors back without merging your accounts, for instance, by calculating how interests will add up.

Ask the debt consolidation company what they will say to your creditors. They will negotiate on your behalf, but make sure that the terms they are going to offer are terms that are acceptable to you. You don't want to get into a worse financial situation than you already are in.

If you find a lender who offers you a high rate, time frame, and the amount of money you need, take that information, in writing, to your current financial institution. They may be able to match or even better that offer just to keep you as a loyal customer.

Extreme amounts of debt plague an unfortunate number of individuals. Many of whom feel there is no hope for ever climbing out of the situation. However, when done wisely, debt consolidation offers a way out. Hopefully, the information presented above has given you the tools you need to move forward with confidence.

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